Is there a clear, simple relation between demography and international power ?
In the preindustrial era, the answer to that question would be a definite yes. However, even though today a large population seems to remain a necessary condition for being a global player, it is far from the only defining factor. Beyond head count, we must consider human capital and the commercial climate to unlock the value of its capital. Today productivity per capita varies by a factor of 100 between low performing and high performing countries, with considerable variation from one large country to another. What defined China’s rise was not so much its population growth as its dramatic increase in urbanisation, health, and education, as well as industrialisation and technological advances.
Demographics do matter, though, as we can see from different patterns amongst global powers. Japan, Germany, and Russia, for instance, have shrinking populations. In Russia, this decline is doubled by a paradox : notwithstanding a highly educated population, the human capital is low. Transition from the Soviet system has proven difficult, and a kleptocratic government doesn’t help. One can infer that population decline and aging will be less forgiving there than in Japan and Germany, whose societies should continue to prosper.
Moreover, the question of geopolitical performance is different : beside the fact that for historical reasons Tokyo and Berlin have long given up strong ambitions in this area, in democratic countries voters don’t favour military spending – and this is even more true in ageing and shrinking societies. On the contrary, demographic decline or low human capital doesn’t seem to affect the desire by authoritarian regimes to show strength on the international stage. Take North Korea, for example : its GDP is close to zero, but it manages to have an outsized influence in international affairs. The Kremlin can still play power politics in Europe (arguably, only as an outside player in the game). Nevertheless, in the long run its demographic potential will decline, and its share of the global educated population will decline too. For some time, the country might compensate for that with more aggressive behaviour ; but it won’t last indefinitely.
China has already replaced Russia as the main challenger to America as a superpower. But its population is ageing too. Can its demographic situation undermine its ascension ?
China faces a different situation. First, it is ten times more populous than the Russian Federation and doesn’t suffer from the same human capital paradox. After Deng Xiaoping, it benefitted from a strong demographic tailwind, but its demographic is now slowing down its economic performance. It is an ageing society with a strong imbalance between men and women of working age, and where the extended family network is disintegrating – all clearly negative factors. As such, China’s era of ‘heroic economic growth’ is probably over. A 2.5 or 3% growth in GDP over the period ahead is possible, which may seem terrifyingly low from Beijing’s point of view. On the military side, there is an unseen aspect of China’s demographic profile that should not be underestimated : with one-child families, the death of a young soldier extinguishes the family lineage, a tragedy anywhere but one freighted even more by metaphysics in the Confucian tradition. I don’t know exactly whether this might affect China’s readiness for military ventures.
Fifteen years ago, the economist and Nobel prize winner Robert Fogel attempted a comparison between India and China in 2040, and he found that India might win the race (in terms of both GDP and global status). As much as I admire him, I think he has already been proven wrong. Numbers can be tricky and, in demographics as elsewhere, we must pay attention to disparities and dispersion. India is a complex mix of very different people, ethnicities, and languages ; and within its population there are very different demographic and educational profiles. Under any circumstances, by 2040 a large fraction of India’s population will have almost no education. Its economic potential is limited – the weird situation being that at the same time its strategy in higher education was set out as a ‘nation-building’ political success.
China’s situation contrasts with the US, which still enjoys vigorous natural growth and attracts talents from all over the world. Does this difference kill the game ?
The US is still the best in class in terms of demographics, and as an American I wouldn’t trade our situation with the EU, Russia, or China. The US demographic profile (natural growth, educational level, and qualified immigration) still supports its international power. Even with China, it has a comparative advantage. But twenty years from now ?
Firstly, what I said about the democratic countries’ reluctance to engage troops abroad applies to America too and might affect its influence. And secondly, as for its demographic dynamism, there might be trouble in paradise. It is likely that in 2020 and 2021 the U.S. will see its slowest years of demographic growth ever officially recorded. The Covid crisis is not the only culprit : since the crash of 2008 America’s fertility rate has fallen to a historic low.
There is also the question of immigration : the US has restricted immigration harshly in the past—from the 1920s through the 1960s—and a reprise unfortunately is not unimaginable. That phenomenon might lead to a population peak instead of the continuous growth that has been a main factor in the ascent of the US to its current status of sole superpower. Besides, in the last twenty years we have seen worrying stagnation problems in health or education which, coupled to other difficulties, might make it difficult to unlock its human capital potential.
